by James A. Bacon

The landscape of innovation has been dominated in the post-World War II era by places like Silicon Valley and the Research Triangle, suburban corridors of disconnected corporate campuses, accessibly only by car. But a new model — the innovation district — is emerging, contend Bruce Katz and Julie Wagner with the Brookings Institution in “The Rise of Innovation Districts: A New Geography of Innovation in America.”

In recent years, a rising number of innovative firms and talented workers are choosing to congregate and co-locate in compact, amenity-rich enclaves in the cores of central cities. Rather than building on green-field sites, marquee companies in knowledge-intensive sectors are locating key facilities close to other firms, research labs, and universities so that they can share ideas and practice “open innovation.”

Innovation districts are emerging in cities across the United States and abroad. Most of them are located in the urban core, often older industrial areas, that are being “re-imagined and remade.” Others are arising in traditional suburban office parks, which are scrambling to compete. Continue Katz and Wagner:

Innovation districts represent a radical departure from traditional economic development. Unlike customary urban revitalization efforts that have emphasized the commercial aspects of development (e.g. housing, retail, sports stadiums) innovation districts help their city and metropolis move up the value chain of global competitiveness by growing the firms, networks and traded sectors that drive broad-based prosperity. Instead of building isolated science parks, innovation districts focus extensively on creating a dynamic physical realm that strengthens proximity and knowledge spillovers.

What is driving this shift? Katz and Wagner argue that the evolution of a knowledge- and technology-intensive economy is altering the value of density and proximity. Density and proximity accelerate the exchange of ideas, the transfer of knowledge and pace of innovation. No one company can master all the knowledge and all the disciplines it needs, so businesses increasingly rely upon networks of industry collaborators. The desire to embed themselves in these collaborative networks has driven many companies from the isolated suburban office campus to denser urban neighborhoods that can support such networks.

Another critical trend is the growing demand among workers for more walkable, mixed-use neighborhoods. This preference is particularly strong among young, tech-savvy workers coveted by innovative companies.

The Katz-Wagner paper is must reading for anyone who is convinced, as I been preaching, that the traditional economic development model in Virginia, which dates back to the 1960s-70s era, is outdated and not working anymore. Yes, Virginia can blame some of its current economic woes upon federal sequestration and budget cutting but the malaise runs deeper. Virginia’s economic performance has fallen from a national pace-setter to middle-of-the-pack. We have been slow to understand and respond to the changes that Katz and Wagner describe. We have been slow to innovate the institutions of economic development.

The City of Richmond’s futile pursuit of a baseball stadium and slavery museum in Shockoe Bottom is a perfect example of misplaced priorities. The irony is that, here in the Richmond metropolitan region, the city is better positioned than any of its suburban counterparts to take the economic lead. Proto-innovation districts are sprouting on the fringes of downtown, especially in Shockoe Bottom, Manchester and the Virginia Biotechnology Research Park. Downtown, with its walkable, bikable streets, its proximity to Virginia Commonwealth University, its diversity of housing types, its historic architecture and its cross-fertilization of science, business and the arts, is precisely where innovation districts logically would take hold. This is the economic future of the Richmond region. The ballpark hoo-ha suggests that city leaders just don’t get it.

Richmond’s suburbs, like suburban communities across Virginia, also need to take heed. Economic development no longer favors the green-fields. The logic of the knowledge-innovation economy favors walkable urban places. Virginia’s suburban counties are woefully short of such places. As the innovation-district movement gains momentum, suburban communities will find it more and more difficult to attract big commercial office projects to build their tax base. The writing is on the wall: Suburban counties need to create walkable, mixed-use, amenity-rich districts of their own or find themselves as disadvantaged in the economic development game as the cities were a half-century ago. Making that transition while protecting the integrity of neighborhoods full of single-family dwellings will be the great challenge of the next generation.

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12 responses to “The Rise of Innovation Districts”

  1. “Another critical trend is the growing demand among workers for more walkable, mixed-use neighborhoods. This preference is particularly strong among young, tech-savvy workers coveted by innovative companies.” Walk through the neighborhoods within three blocks of the Clarendon and Court House subway stops in Arlington, indeed the whole Ballston Corridor, and you will see a vibrant demonstration of what our young people value.

    1. DJRippert Avatar

      What? People from Richmond finding something to emulate in Northern Virginia? Acbar – are you crazy? People from the sainted Capital of the Confederacy wouldn’t dirty their shoes walking on the filthy streets of Fake Virginia. No way. They worship at the alter of true Virginians like Robert E Lee. Where was he from again?

  2. larryg Avatar

    Richmond is an old city. it was there as a grid-streeted urban place long before Henrico and Chesterfield were anything but forest and farmland.

    So Richmond started out in a configuration at it’s inception the dense place that is now advocated for – again.

    over the evolution of RIchmond – it did not add density – or expand it’s density core – alone – it also added much less suburbs.

    Why is this important ?

    Because the current advocacy to “go back” presumes that something “wrong” caused the creation of the suburbs – more often than not – “restrictions” on density as well as highways.

    we can’t very easily “undo” the network of highways.. and I doubt seriously that until I see “restrictions” – different from the kind we see in suburbs.. really had much to do with it or at the very least – explain how similar restrictions in urban areas encourage people to move to suburbs with very similar restrictions.

    In other words, identify the unique restrictions to urban areas that “disrupts” and discourages “innovation districts”.

  3. DJRippert Avatar

    Ahhh Jim – you get so close to the truth. Then, you turn tail and run in the opposite direction.

    The innovation district is 100% right! That’s the best description I ever read of what needs to be done. It’s why I keep asking why the Richmond City Council goes to Tampa when they should be going to Austin, Louisville or even Arlington, VA.

    But you get wrapped around the axle on the baseball stadium. That baseball stadium is a perfect addition to the innovation district. Forget baseball – think about summertime concerts at the stadium. The Richmond Airport also needs a major facelift (at least, from when I last went there). But … just letting bars stay open late on the weekends inside the innovation district helps too. So would blocking off the streets and letting people wander from bar to bar with drinks in their hands on Friday and Saturday nights.

    Figuring out what young people want isn’t that hard. Go to Austin, San Francisco, Arlington, Louisville, etc and look.

    Some of what is needed will be provided by the free market. Some can be zero cost changes made by government. Some will require considerable civic investment.

    1. You make an interesting point about the ballpark as an amenity for the innovation district. Unfortunately, none of the ballpark supporters ever pitched it that way. It would be interesting to have that discussion.

      Blocking off streets and letting people wander from bar to bar with drinks in hand… now, those are ideas I can get behind. Cheap and effective.

      1. DJRippert Avatar

        I don’t think the city council in Richmond ever intended the ballpark to be an innovation district amenity. They just stumbled into what might have been a good idea. However, the ballpark alone is insufficient.

        Four of my five sons are between the ages of 18 and 24. Understanding what they like is easy. They like Arlington, they like Austin, they like Nashville, they like Louisville. They like Reston. They see no good reason to go to McLean, Fairfax City, Richmond or Naples, FL.

        Young people have something middle aged people don’t have … time. They want to fill that time with activities that let them socialize with other young people. They like cold beer, hot music, an easy way to meet people, parks for sports activities (like softball) and easy access to running and biking trails.

        They also like to live near the social scene.

        This is not all that hard to figure out.

        1. larryg Avatar

          Richmond has some of the finest urban whitewater in the country and a real popular place for the young and active.

          In my travels, I have noted that Harrsionburg, Blacksburg, Asheville, Boise, Bend, Butte, Austin, Boulder, to name a few…. bike, paddle, ski, hang glide, .. active outdoors … attracts many of the young – once they’ve found a job of course.


    2. virginiagal2 Avatar

      Why would you have summertime concerts at a stadium, when there’s already an amphitheater going in nearby specifically for concerts, and plus there are two (I think) stages for summer concerts over at Brown’s Island?

      I personally do not think the ballpark is a good fit for downtown.

  4. jyl1st Avatar

    Richard Florida discussed this at length in his book The Great Reset –

  5. virginiagal2 Avatar

    Question. Is it possible that innovation districts actually work better when they develop relatively organically, rather than trying to force an innovation district?

    I find some of the cities discussed here really appealing and charming. They seem organic, networked, and real, tied to a sense of place. Austin is great. It wasn’t mentioned, but New Orleans, with its distinct neighborhoods, is getting a bit of a tech renaissance. San Francisco has always been a place people recognize as a great city.

    I do not have a similar reaction to many of the forced urban revitalization ideas I’ve seen in Richmond. They seem heavy handed, dictatorial, and very, very top down.

    For example, I have lots of friends in Portland. I love Portland. When Portland does bike ways, my understanding was it involves the neighborhood and it’s a welcomed asset to neighbors who wanted it and sought it. The reported planning for the Floyd bikeway seems to be more like the boy scout who dragged the little old lady the wrong way across the street.

    I’m currently working on a startup. I even got an offer of funding without asking for it – the reason I’ve been online here more is as a break as I try to update the business plan. From what I can gather, people 50-60 are the biggest cohort starting businesses – not 20-30 year olds.

    When I’m looking at what helps me, having someone to network with about business plans, revenue estimation, figuring out options to get a good health plan for future employees, pros and cons as to how much equity to give to who, having a good accountant or lawyer – those are really important to me right now. That doesn’t mean I have to live next to, or in some cases even in the same state as, the people I’m networking with.

    I’m not really looking for an innovation district. I love the Fan. I love Carytown. I love the Museum District. I really enjoyed the time I’ve spent at the river. I find the Shockoe Plan offputting and after watching the way the city has handled it, I would be less likely, not more likely, to put an office in the city limits. It just seems really crony-ish and elitist. That’s not the vibe I’m going for when I envision what I want to create.


  6. Excellent points, Jim!

  7. […] If city officials were feeling especially adventurous, they could foster the creation of innovation districts” that would stimulate sustainable, entrepreneurial-based economic growth. Most of those […]

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